Dutch-style repurchase is seen as weak + UBS Group AG downgrades rating, Wix.com (WIX.US) falls nearly 10%

On Thursday, website development company Wix.com (WIX.US) became the focus of the market. The company announced that it plans to repurchase approximately 18.7 million shares of stock through a Dutch auction at a price of $92 per share. Wix's stock price plummeted on the same day, not only giving up all pre-market gains but also closing with a 9.45% decrease. In a statement, Wix stated that the expected repurchase of 18,718,009 shares will cost approximately $1.722 billion. As of April 1st, these 18.7 million shares represent about 31.6% of the company's total outstanding shares. The final quantity and price of the repurchase may still be adjusted. J.P. Morgan is serving as the dealer manager for this tender offer. Last month, Wix had announced plans to invest around $1.75 billion in a modified Dutch auction, with the expected repurchase price range per share being between $80 and $92. Furthermore, UBS Group AG downgraded Wix's rating from "buy" to "neutral" on the same day, citing concerns about its future growth. Analyst Christopher Zhang stated in a report to clients, "Wix's outlook for 2026 shows a slowdown in core business growth from around 12% in 2026 to about 8%, and further deceleration beyond 2027. We expect the damage to core business growth, coupled with the heavy investment in Base44 and uncertainty, will leave Wix slightly below the '40 rule' requirements over the next three years."